When and why your Social Security payment goes up

Your Social Security benefit increases once a year, usually in January, based on a measure called the Cost-of-Living Adjustment (COLA). The Social Security Administration calculates COLA by comparing the average price of goods and services from the third quarter of one year to the third quarter of the previous year. If prices have risen, your benefit rises by the same percentage.

COLA is not automatic in the sense that you do nothing — the increase happens to your account without any action on your part. But the percentage itself varies year to year. Some years the increase is substantial; other years it is small. In years when prices have actually fallen, COLA can be zero, meaning your benefit stays the same.

You will see the new amount in your January payment and in the benefit statement the Social Security Administration mails or makes available online in December. If you receive your benefit by direct deposit, the new amount lands in your account on your regular payment date in January.

Key Takeaways

  • Your Social Security benefit increases each January by a percentage that matches how much prices rose over the previous year.
  • The Social Security Administration calculates the increase automatically — you do not need to do anything to receive it.
  • The increase applies to retirement benefits, survivor benefits, and disability benefits in the same way.
  • You can see what your new benefit amount will be in the benefit statement the Social Security Administration sends in December.

How the increase is calculated

The Social Security Administration uses data from the Consumer Price Index (CPI), which the Bureau of Labor Statistics publishes monthly. Specifically, the agency looks at the average CPI for urban wage earners and clerical workers from July, August, and September of one year, then compares it to the same three months from the previous year.

If the average for the current year is higher, the percentage difference becomes your COLA. For example, if the CPI average was 300 in the third quarter last year and 306 this year, your benefit increases by 2 percent. The Social Security Administration announces the exact percentage in October, and the increase takes effect in January.

This method means COLA reflects real changes in what things cost — groceries, utilities, medical care, housing. It does not reflect changes in your personal circumstances, your income, or your work history. It is the same percentage for every beneficiary.

Who receives the increase

If you receive any form of Social Security benefit, you receive the COLA increase. This includes retirement benefits, survivor benefits paid to your family members after your death, and disability benefits. Supplemental Security Income (SSI), a separate program for people with low income and limited resources, also receives a COLA increase, though it is calculated on a slightly different schedule.

You do not have to be working, retired, or meet any other condition to receive the increase. If Social Security is paying you a benefit in January, the new amount applies to that payment.

When the increase appears in your account

The increase takes effect on January 1 each year. If you receive your benefit by direct deposit, the new amount will be in your bank account on your regular payment date in January. The Social Security Administration pays benefits on different dates depending on your birth date: some people receive payment on the second Wednesday of the month, others on the third or fourth Wednesday.

If you receive a paper check, the check will reflect the new amount. If you have not yet set up direct deposit, you can do so through your Social Security account online or by calling the Social Security Administration at 1-800-772-1213.

In December, before the increase takes effect, the Social Security Administration mails a notice showing your new benefit amount. If you have a my Social Security account online, you can view the new amount there as well.

What happens if there is no increase

In years when the Consumer Price Index has not risen compared to the previous year, COLA is zero and your benefit amount stays the same. This has happened only a few times in recent decades. When it occurs, your January payment is identical to your December payment.

The Social Security Administration still sends a notice in December explaining that there is no increase. This is not an error and does not affect your benefit in any other way.

How to check your new benefit amount

The easiest way to see your new benefit amount before January is to create or log into your my Social Security account at ssa.gov. Once you are logged in, you can view your benefit statement, which shows your current payment amount and, starting in December, your new amount for the coming year.

If you do not have an online account, you can call the Social Security Administration at 1-800-772-1213 to ask about your new benefit amount. A representative can tell you the exact dollar amount and answer questions about how it was calculated. You can also visit your local Social Security office in person, though calling ahead is recommended to avoid a long wait.

The notice the Social Security Administration mails in December also lists your new amount clearly at the top of the page.

Frequently Asked Questions

Can I refuse the increase or ask for a different amount?

No. COLA is applied automatically to all beneficiaries at the same rate. You cannot opt out or request a different percentage. The increase is based on national price changes, not individual circumstances.

Does the increase affect my Medicare premiums?

Medicare Part B and Part D premiums are deducted from your Social Security benefit. In most years, the law protects beneficiaries so that their net benefit (the amount after premiums) does not fall. However, if your benefit increase is very small, your premium may take most or all of it. The Social Security Administration explains this in your December notice.

What if I think the increase amount is wrong?

Contact the Social Security Administration at 1-800-772-1213 or visit your local office. A representative can review how your increase was calculated and explain the amount. Errors are rare, but the agency will correct them if one is found.

Does the increase explore to benefits I receive as a family member of a retired or deceased worker?

Yes. Spouses, ex-spouses, children, and parents receiving benefits based on someone else's work record all receive the same COLA increase as the primary beneficiary. The percentage is identical across all family members.

When will I see the increase if I just started receiving benefits?

If you begin receiving benefits in a month other than January, your first payment reflects your initial benefit amount. You will receive the COLA increase the following January. For example, if you start benefits in June, your June through December payments are at the initial rate, and your January payment includes the increase.